subject
Mathematics, 30.07.2019 17:10 eraines1714

Suppose there is a bond in abc company that that pays coupons of 8.5%, and suppose that these coupons are paid annually.
suppose the face value of the abc bond is $1000 and the maturity is 11 years.
a) if the appropriate discount rate for this bond is 6%, what would you be willing to pay for abc’s bond?
b) if a comparable company, xyz, has a 7.0% coupon bond with a maturity of 9 years and a face value of 1000, and that bond is trading in the market for $994.50, what would you be willing to pay for abc’s bond?
c) suppose you find that the true fair value for abc bond is $1200.00, but you see that the bond trading for $1051.00, what would you recommend?

ansver
Answers: 2

Another question on Mathematics

question
Mathematics, 21.06.2019 16:30
Question 5 spring semester final exam math evaluate
Answers: 2
question
Mathematics, 21.06.2019 18:20
What is the y-intercept of the line given by the equation
Answers: 2
question
Mathematics, 21.06.2019 19:20
What is the measure of ac? 5 units 13 units 26 units 39 units 3x- 2b 6x + 9
Answers: 2
question
Mathematics, 21.06.2019 20:20
Tomas used 3 1/3 cups of flour and now has 1 2/3cups left. which equation can he use to find f, the number of cups of flour he had to begin with? f+3 1/3=1 2/3 f-3 1/3=1 2/3 3 1/3f=1 2/3 f/3 1/3=1 2/3
Answers: 1
You know the right answer?
Suppose there is a bond in abc company that that pays coupons of 8.5%, and suppose that these coupon...
Questions